KPMG, one of the Big Four consulting firms, is on the verge of breaking new ground in the U.S. legal market having secured a panel endorsement under Arizona’s progressive programme allowing non-lawyers to own and operate law practices. If approved, KPMG would become the first Big Four accounting firm to offer legal services in the U.S., directly competing with traditional law firms.
Finacial Times reports the endorsement, recommended by an Arizona judicial committee, is now awaiting approval from the state’s supreme court. This license would allow KPMG to operate as an “alternative business structure” (ABS), opening the door to providing a range of legal services.
A Strategic Move into Legal Services
KPMG’s interest in Arizona’s ABS framework reflects years of careful study and preparation. Tom Greenaway, a partner in KPMG’s tax division, expressed enthusiasm for the development. “We have been studying the Arizona structure for years and are excited by the opportunity it presents to us,” he told the state’s committee. “The time is right, given the advances we have made with technology and the maturity of the market. Our business is big business,” Greenaway concluded.
The license would enable KPMG to focus on routine, technology-driven legal work, such as managing employment or consumer lending contracts, and harmonizing vendor agreements after mergers and acquisitions. These process-driven services align well with KPMG’s technological capabilities and expertise.
Expanding KPMG’s Reach
Christian Athanasoulas, KPMG’s tax practice leader for services, highlighted the broader impact of obtaining a U.S. law license. “This license will significantly expand the services we can offer to in-house legal departments, not just in Arizona but nationwide,” he told the Financial Times. Athanasoulas pointed out that traditional law firms often lack a nationwide presence, whereas KPMG’s infrastructure would enable seamless service delivery across all 50 states.
Globally, KPMG’s legal services are integrated into its tax and legal division, which generated $8.7 billion of the firm’s $38.4 billion in revenue during the year ending in September. This division was also the fastest-growing, reporting a 10% increase in fees year-over-year. KPMG already operates legal services in countries like the UK, where non-lawyers can own and manage law practices.
Arizona’s Leadership in Legal Market Liberalization
Arizona became the first U.S. state to permanently liberalize its legal market in 2021, paving the way for initiatives like KPMG’s. Although Utah and Washington have similar pilot programmes, Arizona has issued 108 ABS licenses to date. On the same day KPMG’s recommendation was announced, four other smaller firms also received ABS license endorsements.
KPMG views this license as a key step toward revolutionizing the delivery of legal services in the U.S., leveraging technology and its global footprint to challenge the status quo in the legal industry.
